AnalysisCanadaDataProvincial disclosure of cannabis data would lead to better policy

Better data would allow researchers to test the effectiveness of regulations and lead to a more robust market overall, experts say
Jared Gnam Jared GnamMarch 17, 202118 min

Provinces’ poor disclosure of recreational cannabis sales data is frustrating researchers trying to study ways to improve Canadian pot policy, one expert says.

While Canada was the first G7 country to legalize weed in 2018, provincial governments continue to limit the release of sales data.

But with the Cannabis Act slated for federal review in October, it’s crucial for researchers to be able to access detailed sales figures so they can provide insights on the complex policy experiment, according to cannabis industry expert and Brock University business professor Michael Armstrong.

In Canada, the federal government regulates cannabis production and medical sales across the country, while provinces regulate sales of recreational cannabis within their jurisdictions.

At a minimum, provinces should publicly release their monthly recreational cannabis sales data that they already collect and supply to Health Canada, Armstrong argues.

Providing academics and economists with access to granular sales data could drastically improve their research on the social, economic and health effects of legalization. In turn, a wider range of studies would help health care organizations and all stakeholders push for evidence-based regulatory improvements in October, the professor says.

When the Cannabis Act was being drafted, federal politicians argued legalization would improve public health and safety. Having better data would allow researchers to test how policy has impacted problem areas like law enforcement on racialized groups, and if weed-impaired driving has put more people in hospital.

Provincial disclosure of cannabis data would lead to better policy
A City Cannabis store in downtown Vancouver. Photo by Jared Gnam

US states disclosing hundreds of data points while provinces in single digits

Although Statistics Canada reports monthly legal adult-use weed sales — which is broken down by each province and territory — Armstrong says it’s less reliable than the rich monthly data sets that provinces provide to Health Canada.

In particular, the StatsCan retail numbers aren’t broken down by product category, whereas the data that Health Canada collects is. And the federal agency’s monthly retail figures are estimates from samples of retailers in each industry, not total counts of all stores.

StatsCan’s numbers for 2019, stacked up against provincial quarterly sales reports, were only accurate within about plus-or-minus 35 per cent, according to Armstrong.

Armstrong argues that research could benefit greatly from sales data that’s broken down not only monthly, but regionally as well.

Because many provinces have only reported sales data for three fiscal years so far, researchers continue to rely more on counts of licensed stores to gauge regional sales.

“If you only have three data points, you can’t really compare much,” Armstrong explains. “But if you can get 36 data points from each month that’s broken down to the region, or even down to the city, then it’s much easier to detect trends, patterns or the lack of trends.”

He wants provinces to consider U.S. states like Colorado and Washington that are proactive in disclosing detailed cannabis sales data.

Colorado reports monthly cannabis sales broken down by county, whereas Washington breaks down sales to the store level.

For example, from October 2018 to March 2019, Colorado posted 228 retail sales data points online and Washington provided 2,591 but Ontario released just 1.

Provincial disclosure of cannabis data would lead to better policy
Toronto-based cannabis store Neighbourhood Joint says if the OCS increased transparency it would help bolster private stores in Ontario. Press photo

Should private stores own their own data?

In Canada, each province and territory regulates cannabis sales and reports data to the public differently.

To be fair, some of the provincial agencies are much better than others at revealing their sales data and some have improved, Armstrong says.

In particular, the Ontario Cannabis Store didn’t even answer journalists’ requests on where its wholesale warehouse was located when it was launched three years ago.

But in the last year, the province’s sole weed wholesaler and licit online seller has provided quarterly reports that contain data on sales, pricing, retail stores and supply chains.

Read more: Ontario’s legal weed market share climbs to 40%, OCS says

The Crown corporation is committed to being as transparent as possible with cannabis sales data and leads all jurisdictions in Canada to produce a number of data tools that are made widely available, OCS senior director of communications Daffyd Roderick says.

Ontario cannabis lawyer Matt Maurer agrees that the OCS has gotten better at sharing its data in the past year.

However, the Torkin Manes attorney also argues that the agency unfairly claims it owns all cannabis retail data in the province — not the private stores themselves.

This allows the provincial government to monetize that information while at the same time arguably depriving store owners from being able to sell data they generate, Maurer said in an email.

Roderick of the OCS says the restriction on commercialization of sales data has always been part of the OCS’s contract with retailers and enables it “to protect the integrity of our data program and maintain a transparent marketplace for all industry stakeholders.”

Armstrong questions whether the OCS has the right to enforce the restriction.

Read more: Remove OCS advantages to increase Ontario’s legal market share, pot shops say

Provinces sharing insights could identify problem areas, inform policy

Government agencies are notorious for being conservative with revealing data to avoid creating controversies, the professor says.

This means journalists’ requests for data are also often rebuffed.

Last July, a CBC News reporter requested data from Alberta’s cannabis regulator to see if more people were buying weed during the pandemic. But a Alberta Gaming Liquor and Cannabis spokesperson refused to provide second-quarter sales data on the grounds that it was still being audited.

To see how transparent things are in British Columbia, Mugglehead asked the government if it would share cannabis sales tallies for February.

B.C. is the only province that has two agencies that report cannabis sales to Health Canada: the BC Liquor Distribution Branch and the BC Liquor and Cannabis Regulation Branch.

The LCRB told Mugglehead due to a confidentially clause in section 11(1) of the Cannabis Control and Licensing Act that it’s unable to share most data.

“We recognize the importance of sharing data and the LCRB is currently looking into how we may share this type of information with recognized research institutions in the future,” Ministry of Public Safety spokesperson Hope Latham said in an email.

The BC LDB did provide some data for February, although only the agency’s wholesale cannabis sales:

February 2021 $27,393,922  

 

Sub Category % of Sales
Edibles 6.1%
Extracts and Concentrates 24.6%
Flower 51.8%
Pre-roll 16.9%
Seeds 0.1%
Topicals 0.6%
Grand Total 100.0%

Approximately 73 per cent of the BC LDB’s wholesale cannabis sales were to private cannabis retailers and the rest to the province’s publicly-run stores.

Given that BC Cannabis Stores make up only a small portion of total retailers in the province — 25 compared to over 300 private stores — the agency said it’s not sure how valuable it would be.

“Even so it is competitive information,” LDB spokesperson Viviana Zanocco said. “Just as private retail chains are not asked to disclose their sales figures, BCCS shouldn’t be singled out and treated differently.”

Zanocco notes that a number of municipal governments in B.C. do not allow cannabis stores operating in there jurisdictions, therefore regional data would be inconsistent.

Better disclosure would end up benefiting the provinces themselves, Armstrong explains, as data relationships would become clearer. He points to a study he published earlier this year.

“Why did legal fail not progressive quickly as we thought? Why are some provinces better than others?” he wondered. “So I looked for correlations between production levels, and numbers of stores that were open — compared that to sales by month and by province.”

By having the monthly data, Armstrong determined that product shortages were likely first at fault, and then the main problem became a lack of stores. With more provincial on an ongoing basis, it’d be much easier to say which provincial policies are leading to better market performance, which would direct better policy making overall.

Top image by Jared Gnam

 

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